Is Bush about to back the largest tax increase in U.S. history?

[w¡n9Nµ7 §£@¥€r 123]

Will President Bush embrace a tax increase that would produce potential economic disaster and guaranteed political catastrophe?

Henry M. Paulson Jr. ... has engaged in secret bipartisan talks discussing an increase in the current $97,500 limit on personal income subject to the Social Security payroll tax. That would spike up the top marginal tax rate, demolishing supply-side tax principles that Republican administrations have purportedly followed for 26 years.

[...]

Eliminating the cap on payroll taxes would constitute the largest tax increase in U.S. history, estimated by the Heritage Foundation during the last Congress at $1.4 trillion over 10 years. This analysis predicted that such a step would cost nearly a million jobs and more than $55 billion in projected personal savings.

The economic woe that would result from higher payroll taxes would be matched by political damage to the president if this outcome were adopted by the Democratic-controlled Congress with his approval but support from only a few Republican legislators. That political calamity can be averted if Bush takes any payroll tax increase off the negotiating table, just as Democrats refuse to talk about a partially privatized Social Security system.

http://www.suntimes.com/news/novak/201590,...novak08.article

[Yodrak 7]

Gupt,

I would like to see the Heritage Foundation's reasoning for how removing the SS cap would cost almost 1 million jobs. Is it that the people who would be affected - those earning more than $97,500 per year - would have to fire their maids and gardeners because they could no longer afford those services?

Yodrak

Will President Bush embrace a tax increase that would produce potential economic disaster and guaranteed political catastrophe?

Henry M. Paulson Jr. ... has engaged in secret bipartisan talks discussing an increase in the current $97,500 limit on personal income subject to the Social Security payroll tax. That would spike up the top marginal tax rate, demolishing supply-side tax principles that Republican administrations have purportedly followed for 26 years.

[...]

Eliminating the cap on payroll taxes would constitute the largest tax increase in U.S. history, estimated by the Heritage Foundation during the last Congress at $1.4 trillion over 10 years. This analysis predicted that such a step would cost nearly a million jobs and more than $55 billion in projected personal savings.

The economic woe that would result from higher payroll taxes would be matched by political damage to the president if this outcome were adopted by the Democratic-controlled Congress with his approval but support from only a few Republican legislators. That political calamity can be averted if Bush takes any payroll tax increase off the negotiating table, just as Democrats refuse to talk about a partially privatized Social Security system.

http://www.suntimes.com/news/novak/201590,...novak08.article

[Heracles 417]

For once I see a smart move with regards to taxation. The country is fighting a war and has huge amount of debt. Taxes need to be increased across the board.

Why do people fall for such scare tactics with regards to tax increases. I mean come on now. So many countries overseas have much higher taxes and their living standards is much much higher than the average Americans.

Edited January 8, 2007 by Infidel

[Heracles 417]

They have to start taxing all of these kids who inherit daddy's money and pay little or no tax.. IE EG Paris Hilton and co